You Won’t Have to Wait for That iPhone 8

One analyst met with Apple suppliers in Asia and sees ‘limited risk of a significantly delayed launch’ for the new phone, expected out this fall.

By

Emily Bary

May 30, 2017 2:23 p.m. ET

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Augmented reality and a new casing could entice people to upgrade their old iPhones when the new models come out this fall.
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When the iPhone 8 comes out later this year, its key new features likely won’t be much of a surprise. But other big questions about the new device remain a mystery, namely whether it will come out in September -- as has been the case with past models -- and whether customers will rush to upgrade.

After visiting Asia and meeting with iPhone suppliers there, Morgan Stanley analyst Katy Huberty left feeling more confident in Apple’s ability to get the phones out (relatively) on time.

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The iPhone 8 is expected to support augmented-reality functions, and those likely require special 3D-sensing components. That and the iPhone’s processor “appear to be bottlenecks that will limit initial supply, but are unlikely to delay the launch beyond the September/October timeframe,” Huberty wrote Monday.

Overall, she sees “limited risk of a significantly delayed launch.”

Meanwhile, any wait might be worth it. “Augmented reality is the killer application,” Huberty wrote, and could help drive more upgrades and sway Android users (especially in China). She expects Apple will be the market leader in AR.

Many analysts think that the company will come out with three new models in the fall: a slightly upgraded version of the iPhone 7, a slightly upgraded 7 Plus, as well as a fancy iPhone 8 that features a bezel-free design and an OLED screen. That more expensive model will draw most of the attention, but the cheaper two will likely support augmented reality and have prettier casings, making them seem worthwhile to folks who don’t want to shell out upwards of $1,000 for a new device.

Huberty thinks unit sales of the iPhone will grow 22% in its fiscal year that ends in September 2018. That compares to the overall Wall Street consensus of 11%.

Big Picture: After visiting with Apple suppliers in Asia, one analyst thinks it’s unlikely the next iPhone will be significantly delayed.

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